Alcoa (AA) AI Stock Analysis

• Market Cap: $16.52B
• Dividend Yield: 0.75%
• Average Volume (3M): 6.63M
• Price to Earnings (P/E): 14.5
• Beta (1Y): 1.73
• Revenue Growth: 20.08%
• EPS Growth: N/A
• Country: US
• Employees: 13,900
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Aluminum
• EPS (TTM): -0.02
• Shares Outstanding: 258,964,020
• 10 Day Avg. Volume: 9,596,339
• 30 Day Avg. Volume: 6,626,476
• PEG Ratio: -1.24
• Price to Book (P/B): 1.56
• Price to Sales (P/S): 0.66
• P/FCF Ratio: 191.08
• Enterprise Value/Market Cap: 0.58
• Enterprise Value/Revenue: 0.73
• Enterprise Value/Gross Profit: 4.30
• Enterprise Value/Ebitda: 4.50
• 1Y Price Target: $48.00
• Price Target Upside: -20.09% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 9
• EPS Forecast (FY): 4.28
• Revenue Forecast (FY): $13.73B

• Rating: 70 Outperform
• Price Target: $70.00 ▲(16.53% Upside)

The score is driven primarily by improved financial performance (better margins, ROE, and FCF growth with moderate leverage). Technicals show a strong trend but are overheated (RSI/Stoch elevated), which tempers the rating. Valuation is reasonable on earnings (P/E 12.84) but income support is limited, and the latest earnings call was balanced due to tariff cost pressure, mixed results (including adjusted net loss), and operational risk despite constructive shipment/working-capital guidance and strategic investments.

Positive Factors

Revenue Growth

Consistent revenue growth indicates Alcoa's ability to maintain market demand and expand its customer base, supporting long-term business stability.

Operational Efficiency

Improved profit margins reflect enhanced operational efficiency, which can lead to sustainable profitability and competitive advantage.

Strategic Investments

Investments in critical mineral supply chains strengthen Alcoa's market position and align with industry trends towards sustainability.

Negative Factors

Kwinana Refinery Closure

The closure leads to significant restructuring costs and operational challenges, impacting financial performance and workforce morale.

Increased Tariff Costs

Rising tariff costs can erode profitability and affect competitive pricing, posing long-term financial risks for Alcoa.

Alumina Segment Challenges

Declines in the alumina segment revenue indicate potential vulnerabilities in market demand and pricing pressures, affecting overall growth.

Alcoa Business Overview & Revenue Model

Company Description

Alcoa Corporation, together with its subsidiaries, produces and sells bauxite, alumina, and aluminum products in the United States, Spain, Australia, Iceland, Norway, Brazil, Canada, and internationally. The company operates through three segments: Bauxite, Alumina, and Aluminum. It engages in bauxite mining operations; and processes bauxite into alumina and sells it to customers who process it into industrial chemical products, as well as aluminum smelting and casting businesses. The company offers primary aluminum in the form of alloy ingot or value-add ingot to customers that produce products for the transportation, building and construction, packaging, wire, and other industrial markets. In addition, it owns hydro power plants that generates and sells electricity in the wholesale market to traders, large industrial consumers, distribution companies, and other generation companies. The company was formerly known as Alcoa Upstream Corporation and changed its name to Alcoa Corporation in October 2016. The company was founded in 1888 and is headquartered in Pittsburgh, Pennsylvania.

How the Company Makes Money

Alcoa generates revenue primarily through the sale of aluminum products, which include primary aluminum, rolled products, and extrusions. The company also earns income from its bauxite and alumina segments, supplying these essential raw materials for its aluminum production. Key revenue streams include long-term contracts with major customers in sectors such as aerospace and automotive, as well as spot market sales. Alcoa benefits from strategic partnerships and joint ventures that enhance its market presence and operational efficiency. Additionally, the company invests in research and development to innovate and improve its products, which can lead to higher margins and new revenue opportunities.

Alcoa Financial Statement Overview

Summary

Alcoa's financial performance reflects a strong recovery with improved profitability and cash flow. The income statement shows increased revenue and margins, while the balance sheet indicates moderate leverage and effective equity utilization. However, historical fluctuations in financial metrics pose potential risks.

Income Statement

Alcoa's income statement shows a strong recovery with a notable increase in revenue and profitability in the TTM period. The gross profit margin improved to 16.75% from 12.29% in the previous year, and the net profit margin increased significantly to 8.58% from 0.49%. The EBIT and EBITDA margins also saw substantial improvements, indicating enhanced operational efficiency. Revenue growth is positive at 1.26% TTM, reflecting a stable upward trend. However, the company experienced fluctuations in past years, which could pose a risk if market conditions change.

Balance Sheet

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.41, indicating moderate leverage. Return on equity improved significantly to 19.55% TTM, showcasing effective use of equity to generate profits. The equity ratio remains healthy, suggesting a strong capital structure. However, past fluctuations in equity and debt levels highlight potential risks if not managed carefully.

Cash Flow

Alcoa's cash flow statement shows a positive trend with a free cash flow growth rate of 11.86% TTM, indicating improved cash generation capabilities. The operating cash flow to net income ratio is 0.36, reflecting efficient conversion of earnings into cash. The free cash flow to net income ratio is 0.53, suggesting a solid cash position relative to profits. Despite these strengths, historical volatility in cash flow metrics suggests the need for cautious cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	13.26B	12.18B	10.71B	12.76B	12.44B	9.37B
Gross Profit	2.24B	1.50B	241.00M	1.93B	2.62B	765.00M
EBITDA	2.14B	1.09B	155.00M	1.43B	2.06B	972.00M
Net Income	1.15B	60.00M	-651.00M	-123.00M	429.00M	-170.00M
Balance Sheet
Total Assets	15.97B	14.06B	14.15B	14.76B	15.03B	14.86B
Cash, Cash Equivalents and Short-Term Investments	1.49B	1.14B	944.00M	1.36B	1.81B	1.61B
Total Debt	5.16B	2.82B	1.97B	1.87B	1.87B	2.62B
Total Liabilities	9.54B	8.91B	8.31B	8.17B	8.74B	9.84B
Stockholders Equity	6.34B	5.16B	4.25B	5.08B	4.67B	3.31B
Cash Flow
Free Cash Flow	651.00M	42.00M	-440.00M	342.00M	530.00M	41.00M
Operating Cash Flow	1.23B	622.00M	91.00M	822.00M	920.00M	394.00M
Investing Cash Flow	-425.00M	-608.00M	-585.00M	-495.00M	565.00M	-167.00M
Financing Cash Flow	-449.00M	201.00M	57.00M	-768.00M	-1.16B	514.00M

Alcoa Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 60.07
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AA, the sentiment is Positive. The current price of 60.07 is above the 20-day moving average (MA) of 58.23, above the 50-day MA of 47.77, and above the 200-day MA of 34.59, indicating a bullish trend. The MACD of 4.77 indicates Positive momentum. The RSI at 59.95 is Neutral, neither overbought nor oversold. The STOCH value of 55.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AA.

Alcoa Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AA	70 Outperform	$16.52B	14.49	19.77%	0.75%	20.08%	―
HL	70 Outperform	$16.90B	83.07	8.88%	0.07%	45.61%	―
KALU	69 Neutral	$2.13B	23.70	12.41%	2.64%	7.69%	91.86%
CMC	67 Neutral	$8.41B	19.53	10.51%	1.02%	-1.61%	-81.36%
CSTM	62 Neutral	$3.16B	27.58	12.22%	―	8.48%	12.10%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
CENX	56 Neutral	$4.53B	59.57	12.22%	―	20.15%	-72.89%

Alcoa Corporate Events

Alcoa Announces Redemption of 5.500% Notes

On November 25, 2025, Alcoa Nederland Holding B.V., a subsidiary of Alcoa Corporation, announced its intention to redeem all outstanding 5.500% Notes due 2027, totaling $141 million. The redemption, scheduled for December 15, 2025, will be funded using Alcoa’s cash reserves, which stood at $1.49 billion as of September 30, 2025. This move reflects Alcoa’s strategic financial management and could impact its financial position and stakeholder interests.

The most recent analyst rating on (AA) stock is a Sell with a $33.00 price target. To see the full list of analyst forecasts on Alcoa stock, see the AA Stock Forecast page.